At the risk of blowing up the united front on alcohol reform between pro-consumer liberals and libertarians, I think people need to treat alcohol-related public health harms as a gravely serious public health issue.
The anti-monopoly side, myself included, is guilty of being way too glib about this, and my excuse is that beating the pro-monopoly side will require a message as clear and unambiguous as their “no changes” message. Determination always beats wishy-washy in a political fight such as this, with diffuse benefits and concentrated costs.
Unfortunately, Democratic elected officials have behaved incredibly irresponsibly during this fight, complaining about public health harms out one side of the mouth, and higher booze prices out the other.
The degree of bad faith required to make this argument is shocking, as higher booze prices reduce alcohol-related harms. You can complain about one or the other, but not both.
The ideal position from the Democratic Party would be that, to get a bloc of Democratic votes for alcohol reform, the bill must:
1. Raise the crazy low beer gallonage tax from $1.78 to at least $3.00
2. At the least, maintain the same price level for wine and spirits, and ideally raise it a bit.
3. Establish a statewide minimum price for beer, wine and liquor
4. Require every alcohol seller to scan photo IDs
5. Establish a Do Not Serve list for people convicted of multiple crimes under the influence
6. Increase enforcement and penalties for drunk driving
Unfortunately the Democratic Party has not taken any of these positions, and would likely demagogue them if they were proposed as part of the bill.
But regardless of whether the retail alcohol market is liberalized, these are all positions that every politician claiming to be a champion of public health should heartily support.
As Dylan Matthews showed a few days ago, high alcohol taxes are a very effective way to reduce public harms and crime. It is quite possible for Pennsylvania to have a retail alcohol market where it is very convenient for responsible adults to buy what they please, but where heavy drinkers pay a higher share of the state taxes. This is the obvious Democratic position, since Democrats object to public service cuts and want to retain defined-benefit pensions for public employees. Here is an opportunity to reduce the Corrections and courts budgets, while raising revenue for useful public services:
As criminologist Mark Kleiman told me last month, “Any sentence about drug policy that doesn’t end with ‘raise alcohol taxes’ is an incoherent sentence.” He’s hardly the only one with that view. Economics, criminology and public health literature are rife with studies finding that raising the price of alcohol reduces violence, not to mention other causes of injury and death. Indeed, every self-reported survey of incarcerated criminals suggests that 36.8 percent of state-level violent offenders, and 20.8 percent of federal violent offenders, were drinking when they committed the crime for which they’re incarcerated.
Economist Sara Markowitz, for example, found in a study of U.S. crime patterns that a “single percent increase in the beer tax decreases the probability of assault by 0.45 percent” and “a 1 percent decrease in the number of outlets that sell alcohol decreases the probability of rape by 1.75 percent.” Researchers in Finland found that a 2004 cut in the country’s alcohol tax caused a sudden 17 percent spike in fatalities relative to the previous year. There’s preliminary evidence that alcohol taxes can reduce the number of U.S. female homicide victims. Kleiman cites findings of Duke’s Philip Cook to the effect that a doubling of the federal excise tax on alcohol would reduce homicide and automobile fatalities by 7 percent each, for a net 3,000 lives saved. What’s more, it would only cost twice-a-day drinkers (who, as it is, drink considerably more than average) $6 a month.
One common doubt surrounding this method of reducing violent crime is whether or not alcoholics really care what the price of alcohol is. If they don’t, then raising the price would just cost them money without much social benefit. But the data suggests that alcohol consumers are, in fact, sensitive to the price of the product. Researchers at the CDC compiled a number of studies estimating “price elasticities” of different kinds of alcohol.
The elasticity (as Stringer Bell explains above) is the amount by which consumption changes when the price of a good changes. For example, if the elasticity is -0.5, then a 10 percent increase in price will reduce consumption by 5 percent. If the elasticity is 0 or positive, then consumers are either indifferent to the cost of the product or actually want it more because it’s more expensive.
A few studies found that the elasticity of spirits is positive, perhaps because expensive Scotch or bourbon are Veblen goods: people buy them more when they’re more expensive because their expense makes them better status markers. But generally, the elasticities are negative. Raising the price of alcohol, for example by raising the tax on it, is an effective way to reduce consumption, and thus alcohol-related fatalities and assaults:
Researchers Alexander Wagenaar, Amy Tobler and Kelli Komro also conducted a literature review on alcohol tax and price policies, scanning through 50 studies on the subject. Their conclusion: “Our results suggest that doubling the alcohol tax would reduce alcohol-related mortality by an average of 35%, traffic crash deaths by 11%, sexually transmitted disease by 6%, violence by 2%, and crime by 1.4%.” The case for making higher alcohol prices a part of our approach to reducing violent crime, then, is pretty strong.